Heady forecasts about social media spending are one thing (and they’re certainly an indicator of enthusiasm), but actual spending is another. And results from the latest edition of The CMO Survey from Duke’s Fuqua School of Business indicate a continued gap between plans and follow-through on the part of US CMOs. Indeed, if CMOs’ previous forecasts are to be believed, social should occupy some 10% of marketing budgets by now. Yet this latest survey finds current social spend at an average 7.4% of budgets, a figure unchanged from 2 years ago.
That’s probably a function of continued difficulties in social media integration and ROI measurement. When asked how well social media is integrated with marketing strategy, CMOs on average rated its integration a 3.8 (on a 7-point scale, where 7 represents “very integrated”). That score has been stuck at that level for 4 of the 5 previous surveys (which are conducted twice a year), with the August 2013 score only marginally higher at 3.9.
As for social’s ROI? Only 15.9% of respondents said they have proven the impact quantitatively. And while 34.8% feel that they have a good qualitative sense of its impact, almost half haven’t been able to demonstrate its impact yet. Those figures have barely changed at all over the past 6 months. Clearly, CMOs are having a harder time quantifying social’s impact than the impact of their overall marketing spending (though that remains a struggle, too).
The Duke survey is (obviously) not the only one to document these struggles; a recent study [download page] from Demand Metric found 70% of respondents unable to quantify the ROI of their social media efforts.
Nevertheless, CMOs continue to plan for more social media spending, expecting to devote 10.1% of their budgets to it over the next 12 months, and an even more bullish 18.1% over the next 5 years. That’s likely due to an implicit understanding that even if precise measurement is proving difficult, the need for social media marketing remains.
- As a percentage of marketing budgets, current social media spending is largest among B2C services companies (8.9%) and lowest among B2B product companies (6.9%).
- B2C services companies also hold the rosiest outlooks for social media spending as a percentage of overall marketing budgets over the next 12 months (11.4%) and 5 years (20.3%).
- Although they have the lowest projections for social spending over the next 5 years, B2C product companies are the most likely – by a significant margin – to say that social is integrated with marketing strategy.
About the Data: The CMO Survey is conducted online twice a year. The latest survey was fielded from January 14 to February 4, 2014. The survey had 408 respondents, of whom 88% were VP level or above.